By Kevin Wilson: Freedom New Mexico
The Cash for Clunkers program, which has been successful nationwide in spurring new-car sales since it began in late July, had mixed impacts on local dealers through its conclusion Monday.
“We had a lot of positive response out of it,” said Tim Baldwin, the sales and new car manager for Hamilton Big Country Ford in Tucumcari.
There was some variety, Baldwin said, but the bulk of the 50-plus people who took advantage of the program got the Ford Focus. The car was the most popular, Baldwin said, because the sticker price started at about $18,000 before the CARS rebate was factored in.
“Obviously, the Focus was overall the most popular, but we did everything,” said Baldwin, who noted trade-in cars weren’t going to get much trade-in value if the Car Allowance Rebate System program wasn’t involved.
Bryce Bender, co-owner of the Bender family of dealerships in Clovis, said most of his sales were simply people saving a few miles per gallon from one truck to another.
Newer GM and Dodge trucks, Bender said, are configured to use fewer cylinders on the highway, boosting gas mileage.
A common refrain of dealers was the delay in reimbursement, as the businesses are on the hook for rebates and are out the cash for weeks at a time.
Nationwide through early Tuesday, dealers had submitted 665,000 vouchers totaling $2.77 billion. Many dealerships have worked overnight in recent days to submit each trade-in vehicle’s 13-page reimbursement application, including the title, proof of registration and proof of insurance.
The deadline for submission was extended numerous times Tuesday due to problems accessing the database.
The government may have underestimated the popularity of the program, Bender said, because the $1 billion originally set aside was supposed to last through October. The program ended after roughly a month with an extra injection of $2 billion.
Nationwide, consumers rushed to take advantage of rebates taken off the price of new cars in return for trading in older, less fuel efficient vehicles.
Dealers so far have only received a fraction of the reimbursement funds they are owed.
Through last Thursday, the most recent data available, the Transportation Department had reviewed and processed more than 150,000 reimbursement applications and approved just $140 million in payments to dealers. At the time, DOT had processed about 30 percent of all the applications they had received.
Now that the program is over, the challenge is keeping business.
Bender said it shouldn’t be difficult since the CARS program resulted in a slight spike in sales.
“The main thing is to stay focused on customer satisfactions,” Baldwin said. “The ones we couldn’t sell on that, we try to get them back in.”